Saeima moves to keep Estonian booze-cruisers coming

Saeima deputies acted with lightning speed June 20 to reduce the amount of tax payable on strong alcoholic drinks in response to similar recent moves by Estonia, as previously reported by LSM.

Speaking against the proposals Lubova Švecova blasted the way the legislation had been pushed through by the government, saying it paid scant regard to knock-on problems related to alcoholism and the availability of ever-cheaper strong drinks.

Former Prime Minister Māris Kučinskis asked archly if low alcohol prices should be included as part of the national economic development plan and whether the government really wanted a situation in which the public regarded its greatest act as cutting alcohol prices.

Former Prime Ministerial contender Aldis Gobzems said Latvia has a big problem with alcohol and that drinking is "'not stylish". However, he added that he would vote for the excise drop "because taxes in Latvia are too high".

Amendments to the Law on Excise Duty were passed in their first reading by 61 votes to 8 and a special meeting of Saeima will be called for June 21 at which they are likely to be passed in a second and final reading so that they can come into force before July.

The changes to Estonia's own domestic rules would negatively affect the business of Latvian merchants and circulation of alcoholic beverages, especially in the border area of ​​Estonia, according to the annotation of the draft law. The Ministry of Finance has predicted that such a situation would have a negative impact on the state budget of EUR 92 million, and to maintain competitiveness and the internal market, the current rate for strong alcohol should be reduced by at least 15 percent to reduce the negative fiscal impact to around EUR 32 million.